European stocks slide as chip and bank shares come under pressure

what happened

European stock markets showed broad selling in the first hour of trading. According to Reuters, the STOXX 600 index dropped 0.7%, the tech sector lost 1.9% and banks fell 1.3%. Soitec shares declined 6% and ABB shares slipped 5.7%, even though ABB reported record quarterly orders driven by data centre spending.

Shares of South Korean AI services firm Elice Group plunged 30% on their market debut, which halted a small recovery in chip stocks on Monday. The Philadelphia Semiconductor Index rose 1.6% on Monday, ending an eight-day losing streak. Banks dropped another 1% and sit 11.5% below their August peak.

Reuters links the weakness in banks to turmoil in the French bond market, which is hurting French lenders and triggered profit taking in the sector. A deteriorating social climate in Europe adds further pressure. Banking-heavy indexes in Italy and Spain also declined.

why it matters

The simultaneous pressure on banks and semiconductors matters for markets: weakness in bank indexes drags on the broader European market, while doubts about AI themes weigh on chipmakers. For now this is intraday movement, and the picture could change as US data and trading develop.

market impact

European banks and chips: pressure from French bond turmoil and AI-related concerns

tags

instruments